Mayor launches new £10m boiler scrappage scheme for small businesses

30 July 2018

First scheme of its kind in UK

Businesses could receive between 30 and 40 per cent cashback on new cleaner heating systems

Scheme will improve air quality and reduce carbon emissions

The capital is in the midst of a record-breaking heatwave, with the mercury regularly hitting the 30 degrees mark – but it is only a matter of months until winter will be upon us and the hot temperatures will be a distant memory.

So, ahead of the inevitable cold snap, the Mayor of London, Sadiq Khan, is today launching a new £10m boiler scrappage scheme that will help small businesses save money on their energy bills, as well as helping to improve the capital’s air quality.

The Mayor’s Cleaner Heat Cashback scheme – the first of its kind in the UK – will provide between 30 to 40 per cent cashback to small and medium-sized businesses (SMEs) when they replace older, polluting boilers, with new, cleaner heating systems.

This is part of the Mayor’s comprehensive programme of air quality measures, and will also help to make London’s workplaces more energy efficient and cut the capital’s carbon emissions.

London’s workplaces make up around 40 per cent of the capital’s greenhouse gas emissions and this scheme will help fulfil the Mayor’s ambition to make London a zero-carbon city by 2050.

The Mayor is doing everything within his power to tackle London’s toxic air which leads to the premature deaths of thousands of Londoners every year. Newer, more energy efficient heating systems will help to tackle air pollution in the capital as it will see a reduction in harmful NOx (Nitrogen Oxide) emissions.

Commercial gas consumption is currently responsible for 7 per cent of London’s NOx emissions, but as the Mayor’s hard-hitting measures to cut harmful pollutants from transport take effect, this proportion will increase. Transport measures include cleaning up the capital’s bus and taxi fleets and introducing the Toxicity Charge for the oldest polluting vehicles in central London. He is also bringing forward the introduction of the world’s first Ultra-Low Emission Zone to start in April 2019 and extending it up to North and South circular roads from 25 October 2021.

The Cleaner Heat Cashback scheme is part of the Mayor’s £34m Energy for Londoners programme which aims to make London’s homes warm, healthy and affordable, its workplaces more energy efficient, and to supply the capital with more local, clean energy.

Shirley Rodrigues, Deputy Mayor for Environment & Energy, said: “There are thousands of small businesses in London who have older boilers and this hugely innovative scheme not only helps them to save money, but it also reduces carbon emissions and improves the capital’s air quality.

“Businesses could save hundreds of pounds a year on energy bills by switching from an older, inefficient boiler or heating system – and this is exactly the kind of initiative that will help us achieve the Mayor’s ambition of making London a zero-carbon city by 2050.

“Tackling London’s filthy air is one of the Mayor’s top priorities and this is just the latest in a package of measures that he has introduced to improve the quality of the air we breathe.”

In addition the Mayor’s RE:FIT Programme has been retrofitting energy efficiency measures to London’s public sector buildings. This includes installing LED lighting, heating controls and solar PV, together with new energy efficient street lighting.

The Cleaner Heat Cashback scheme is being delivered in partnership with the Energy Saving Trust, industry experts in energy efficiency.

Philip Sellwood, Chief Executive of Energy Saving Trust said: “We are delighted to be supporting the Mayor of London to deliver this ground-breaking scheme. It will help smaller businesses across London to benefit from energy efficiency which in turn will enhance air quality across the city. We hope that other cities across the UK follow the Mayor’s lead and provide similar schemes.”

Notes to editors

TheCleaner Heat Cashback is open to small and medium sized Enterprises (SMEs) in Greater London with older, inefficient boilers. They must own their premises, be a tenant with building maintenance responsibility or have their landlord’s permission and pay commercial rates.

The scheme is open to any type of SME – from start-ups and sole traders, partnerships and limited companies to limited liability companies – provided they meet the EU definition of an SME and have less than 250 employees and an annual turnover of under EUR 50m.

To be eligible, existing heating systems must be working gas, oil or LPG boilers of a minimum 10 years old, or coal or biomass. Systems must be a minimum size of 70kW. Replacement systems must be at least 90 per cent efficient gas or LPG boilers or connect to a heat network or renewable technologies such as solar thermal, air or ground source heat pumps and have NOx emissions of 40mg/kWh or less. Replacement heating systems need to be installed by accredited installers on the system manufacturers approved list.